Merkel vs. Trump: Will Germany be able to challenge new sanctions against Russia?

Author : Dmytro Shemelin

Source :

Sanctions will allow the president of the United States to punish companies involved in the construction or operation of Russia's export pipelines, wherever such companies are located - in the US or abroad
22:43, 2 August 2017

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Without waiting for the signing of bill on new sanctions against Russia, Iran and North Korea by the President of the United States, the Minister of Economy of Germany Brigitte Zypries has already announced that the new US sanctions are contrary to international law. Similar statements were voiced earlier in the French Foreign Ministry.

Why is Germany so worried? After all, over the past few years, the EU itself has repeatedly imposed unilateral sanctions against Russia and former Ukrainian politicians.

The explanation is simple - Nord Stream 2, the Russian gas export pipeline which is under construction.

Sanctions will allow the president of the United States to punish companies that are involved in the construction or operation of Russia's export pipelines, wherever such companies are located - in the US or abroad. Nord Stream 2 is the new export gas pipeline of the Russian Federation, and its main investors are German energy giants.

If we take into account only the legal dimension of this dispute, we must recognize that the task before the lawyers of the German government is extremely difficult: to justify the illegitimacy of a particular type of sanctions, while retaining the institution of unilateral sanctions at the same time.

The application of unilateral economic sanctions at the moment is regulated very vaguely by international law. There is no specific international treaty or custom that would establish when exactly and what sanctions can be applied, and when it will be already illegal.

This is not surprising, since the main players in this field - the EU and the US - on the one hand are not particularly eager to limit their capabilities, and on the other - do not really need the consent of other states to pursue their sanctions policy.

Nevertheless, does international law have any rules that could regulate the application of sanctions?

At first glance, we could find here the analogy with the right to use force in international relations.

One of the main achievements of international law in the last century was the establishment in the UN Charter of a ban on the use of force and the threat of force. Until the 20th century, the use of force in international relations was considered legitimate ("the law of war"). When the UN was created, an attempt was made to ban the use of force, either regarding the sanction of the Security Council or in self-defense.

As is known, this attempt, by and large, failed because of the lack of consensus among the permanent members of the Security Council. Until 1990, the Security Council authorized the use of force only once - during the Korean War, and only because the USSR delegation did not participate in the voting process.

In situation of legal vacuum, the states actually returned to the previous position, when the war again became the "last argument of kings". In response, international humanitarian law has gradually established the rules for the lawful use of military force: necessity, proportionality and selectivity.

The question – to what extent all these rules can be applied to the "economic" force - remains acute.


Related: Nord Stream 2 isn’t for stopping gas transit through Ukraine, it can be preserved under 2 conditions

Some specific decisions of international courts that would recognize the applicability of these principles are not yet available. Nevertheless, economic sanctions have recently become more popular and increasingly destructive, which necessitates their regulation. Consensus, however, has not yet been observed in this matter.

The second rather obvious option is the challenge of sanctions within the WTO. It is difficult to deny that sanctions, especially in the new expanded version, will affect international trade in goods and services.

Immediately after the introduction of the first international sanctions in 2014, Russia intended to challenge certain elements of the sanction regime within the WTO, but after that the sides decided not to continue the case at that time. Nevertheless, more strong sanctions can make Russia more aggressive.

According to many commentators, the challenge of sanctions against Russia within the WTO may come up against the right of member states to take measures to protect national security. The current sanctions are justified by the need to protect international peace and security in connection with the events in Ukraine.

Given that the existence of such a threat is recognized by many international organizations, including UN, the probability of successful protection is high enough.

It is unlikely that the WTO will take the right to decide which measures are adequate to such a serious danger.

Finally, the decisions of the WTO Dispute Settlement Body, although mandatory, are not enforceable. If the WTO suddenly makes a decision that contradicts the declared interests of national security, the United States will almost certainly ignore it.

Accordingly, the entire lengthy procedure of the WTO will not bring any practical result.

And also, the opinions were expressed that US sanctions can be viewed as a violation of the sovereignty of the state (one of the basic principles of international law since the XVII century) by extending US jurisdiction to the territory of the EU.

In general, the US is famous for its laws, which establish the jurisdiction of US courts in situations that at first glance generally do not concern the territory of the United States. For example, any money transfer using a correspondent account in an American bank is in American jurisdiction, even if both sides of the transfer are foreigners.

This is a traditional approach to establishing the jurisdiction of courts in the Anglo-Saxon system: courts generally theoretically can (although in practice they should not) consider any disputes that are not relevant to their jurisdiction.

In fact, the Ukrainian court can also extend its jurisdiction to a foreigner who does not have at all or has very little ties with Ukraine, if there are certain conditions for this - for example, he is a co-respondent of the Ukrainian, or he has links with case of making harm in the territory of Ukraine.

The extension of jurisdiction outside the state of the court is not such an unthinkable thing - in almost all states courts do this from time to time.

Therefore, the argument about the violation of sovereignty, at least in its straightforward formulation, does not look promising. Although formally the United States extend the validity of its laws theoretically to all companies of the world, it can charge them on its territory.

Other states are free to accept or not to take into account the decisions of the American courts in such cases – in such a way the states defend their sovereignty.

In general, the challenge of new US sanctions using international law still seems problematic. Most likely, this dispute will be resolved more effectively in the framework of political negotiations.

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